Convicted lawyer Michael Avenatti admitted Thursday to four counts of wire fraud and one count of tax evasion linked to a federal court case in Southern California.
While in federal jail, Avenatti admitted to defrauding his clients but disputed with federal prosecutors on how much. He made the plea during a court hearing in Santa Ana on Thursday.
This is what Avenatti admitted to the court: I took money from their settlement and misused it. However, Avenatti believes his debt to them is much lower than the $9 million that they claim.
Prosecutors said that Avenatti’s guilty plea, which he made without an agreement, could land him in prison for up to 83 years. On top of the 36-count indictment charging him with bank and bankruptcy fraud, prosecutors said they plan to decide by Monday whether or not to bring charges against him stemming from his alleged scheme to defraud clients by collecting settlement payments on their behalf and funneling the funds into his accounts.
Attorney Brett Sagel, an assistant US attorney, said in a press conference, “Michael Avenatti finally admitted what the IRS criminal investigation and our office have been saying for several years now: that he committed audacious acts to steal money from his clients to line his own pockets.”
He will be sentenced at least on his behavior of violating his duties to his clients and his duties as a taxpayer as a result of this first step before the government decides on the additional charges.
If more accusations are brought against the defendant, the sentencing session scheduled for Sept. 19 will be postponed until the following month.
He submitted papers with the court last weekend stating that he wanted to amend his plea to avoid further shame for his family, even though no agreement had been reached between him and the federal prosecutors.
Due to his convictions in two New York instances, Avenatti is currently serving five years in federal prison in California. While representing Stormy Daniels in her legal battle with then-President Donald Trump, he stole money from the porn star’s book sales. He has since been sentenced to two years in prison. In addition, he was found guilty of attempting to blackmail Nike out of up to $25 million in cash.
In the wake of Daniels’ lawsuit against Trump for violating a confidentiality agreement, Avenatti rose to prominence as a result of his work on the case. On cable news and Twitter, he became one of President Trump’s most vocal foes. He even pondered running for president in 2020.
Last year, the judge in the California case declared a mistrial after finding that prosecutors failed to turn over significant financial evidence to Avenatti. He was due to stand trial on some of the charges next month, with the remainder of the charges to be tried at a later date.
Jurors, in this case, have argued that Avenatti took millions of dollars from his clients and spent it all on himself, rather than paying them what they were entitled to get paid. Among other things, they said he owes millions in payroll taxes from a coffee chain he ran in personal and business tax evasion.
However, Avenatti gave the man only $1,000 to $1,900 as advances on the $4 million judgment he allegedly won from Los Angeles County for an in-care victim who was left paralyzed following an attempt at suicide while in his custody.
Prosecutors allege that Avenatti used a $2.75 million settlement payment from a client to buy a private plane with the rest of the money.
In addition to the civil judgment and the bankruptcy proceedings of his law practice, Avenatti had a long list of legal issues before the criminal allegations were brought against him.
According to US District Court Judge James V. Selna, it is still unclear how much restitution Michael Avenatti owes. He inquired if anyone had promised him anything in exchange for his guilty plea and underlined that he could sentence him to a maximum of 83 years in jail.
“No one has offered me any guarantees, Your Honor, because there are no guarantees, Your Honor,” Avenatti, who admitted he was apprehensive, told the court.